Chapter 22.The Battle for National Reform

The spirit of reform came relatively late to national politics, but come it did. As progressives encountered setbacks and frustrations in their efforts to win social and economic reforms at the state and local level, they began increasingly to look to the federal government as a court of last resort. Efforts to reform the industrial economy, in particular, seemed to require action at the federal level. The great combinations were national in scope; only national action could effectively control their power. But just as at the state and local levels, the national government seemed at first unable to respond to popular demands, mired as it was in the tired partisan politics of the nineteenth century. Progressives attempted to make it more responsive to their demands in various ways. They tried in Congress to limit the power of conservative party leaders and make the legislative process more responsive to the popular will. Some reformers, for example, urged an end to the system whereby United States senators were elected by the members of their state legislatures; they proposed instead a direct popular election, which they believed would force the Senate to react to public demands. The Seventeenth Amendment provided for that change; after conservatives had delayed action on it for years, it was finally passed by Congress in 1912 and ratified by the states in 1913. Even a reformed Congress, however, could not be expected to provide the kind of coherent leadership that the progressive agenda required. If the federal government was truly to fulfill its mission, it would, most reformers agreed, have to do so largely through the executive branch. It would require, above all, strong leadership from the one office capable of providing it: the presidency.

Theodore Roosevelt and the Progressive Presidency

"Presidents in general are not lovable/' Walter Lipp-mann, who had known many, said near the end of his life. "They've had to do too much to get where they are. But there was one President who was lovable—Teddy Roosevelt—and I loved him."

He was not alone. To a generation of progressive reformers, Theodore Roosevelt was more than an admired public figure; he was an idol. No president before and few since could match him in attracting attention and devotion. Yet for all his popularity among reformers, Roosevelt was not the era's most advanced progressive. In many respects he was decidedly conservative. He earned his extraordinary popularity less because of the extent of the reforms he championed than because of the vigor and dynamism with which he approached them. He brought to his office a broad conception of its powers, and he invested the presidency with something of its modern status as the center of national political life.

The Accidental President

Roosevelt was not intended by his party for the presidency. Republican leaders had nominated him to run for vice president with William McKinley in 1900 largely to remove him from the governorship of New York, to which he had been elected in 1898 and where he was proving troublesome to party bosses. When McKinley suddenly died in September 1901, the victim of an assassination, Roosevelt was only forty-two years old, the youngest man ever to assume the presidency. Already, however, he had achieved a notoriety that caused party leaders to feel something close to despair. "I told William McKinley that it was a mistake to nominate that wild man at Philadelphia," Mark Hanna was reported to have exclaimed. "I asked him if he realized what would happen if he should die. Now look, that damned cowboy is President of the United States!"

Roosevelt's reputation as a wild man was, characteristically, a result less of the substance than of the style of his early political career. As a young member of the New York legislature, he had displayed an energy seldom seen in that lethargic body. As a rancher in the Dakota Badlands (where he retired briefly after the sudden death of his first wife), he had helped capture outlaws. As New York City police commissioner, he had been a flamboyant battler against crime and vice. As commander of the Rough Riders, he had led a heroic, if militarily useless, charge in the battle of San Juan Hill in Cuba during the Spanish-American War.

Never, however, had Roosevelt openly rebelled against the leaders of his party; and once in the White House, he continued to balance his personal dynamism against the demands of the political establishment, becoming a champion of cautious, moderate change. Reform was, he believed, less a vehicle for remaking American society than for protecting it against more radical challenges.

Managing the Trusts

For all his cautiousness, however, Roosevelt did bring certain assumptions to the presidency that markedly differentiated him from his predecessors. Imbued with progressive ideas about the importance of the efficient, modern management of society, he envisioned the federal government not as the agent of any particular interest but as a mediator of the public good. The president would be the central figure in that mediation.

Such attitudes found expression in Roosevelt's policies toward the great industrial combinations. Like William McKinley, he was not opposed to the principle of economic concentration. Unlike McKinley, however, he acknowledged that consolidation produced abuses of power that could prove harmful to society. He allied himself, therefore, with those progressives who urged regulation (but not destruction) of the trusts.

At the heart of Roosevelt's policy was his desire to win for government the power to investigate the activities of corporations and to publicize the results. The pressure of educated public opinion, he believed, would alone eliminate most corporate abuses. Government could legislate solutions for those that remained. The new Department of Commerce and Labor, established in 1903 (and later to be divided into two separate departments), was to assist in this task through its investigatory arm, the Bureau of Corporations.

Roosevelt did make occasional flamboyant gestures on behalf of a more drastic approach to reform. Although not a trust buster at heart, he engaged in several highly publicized efforts to break up notorious combinations—actions that strengthened his credentials as a progressive without offering any fundamental challenge to the structure of the economy. In 1902, he ordered the Justice Department to invoke the Sherman Antitrust Act against a great new railroad monopoly in the Northwest, the Northern Securities Company, a $400 million enterprise pieced together by J. P. Morgan, E. H. Harriman, and James J. Hill. To Morgan, accustomed to a warm, supportive relationship with Republican administrations, the action was baffling. Hurrying to the White House with two conservative senators in tow, he told the president, "If we have done anything wrong, send your man to my man and they can fix it up." Roosevelt proceeded with the case nonetheless, and in 1904 the Supreme Court ruled that the Northern Securities Company must be dissolved. At the same time, however, he assured Morgan and others that the suit did not signal a general campaign to dissolve trusts. Other monopolistic corporations, such as United States Steel, he would challenge only if "they have done something we regard as wrong." Although he filed more than forty additional antitrust suits during the remainder of his presidency, and although he succeeded in dissolving several important combinations, Roosevelt made no serious effort to reverse the prevailing trend toward economic concentration. Regulation, with the government serving as mediator between corporate and public interests, remained his central goal.

Government and Labor

A similar commitment to establishing the govern-ment as an impartial regulatory mechanism shaped Roosevelt's policy toward labor. In the past, federal intervention in industrial disputes had almost always meant action on behalf of employers, as in the Pull-man strike in 1894. Roosevelt, however, was willing to consider labor's position as well.

He displayed this willingness during a bitter strike in 1902 by members of the United Mine Workers employed in the anthracite coal industry. Miners, under the leadership of John Mitchell, were demanding a 20 percent wage increase, an eight-hour day, and recognition of their union. Management, represented by the combative George F. Baer, was responding with conspicuous arrogance and contempt. When the strike threatened to drag on long enough to endanger coal supplies for the coming winter, Roosevelt decided to step in—not to assist management but to invite both the operators and the miners to the White House, where he asked them to accept impartial federal arbitration. Mitchell readily agreed. Baer balked.

Furious at the obstinacy of the mine owners (who had already alienated public opinion), Roosevelt threatened drastic action. He would, he told them, order 10,000 federal troops to seize the mines and resume coal production if the dispute was not resolved. Under pressure from politicians, the press, and perhaps most significantly, J. P. Morgan, the operators finally relented. Arbitrators awarded the strikers a 10 percent wage increase and a nine-hour day, but no recognition of the union. It was a meager reward for a long and costly strike, but it was more than the miners might have won without the government's intervention.

Despite such episodes, Roosevelt viewed himself as no more the champion of labor than of management. On several occasions, he ordered federal troops to intervene in strikes on behalf of employers—in Arizona in 1903 and in Colorado in 1904. And although he believed in the right of workers to join a union, he believed, too, in the right of employers to refuse to bargain with it.

The Square Deal

Even if Roosevelt had wished to move more quickly on economic reforms (and there was little evidence that he did), he would have been reluctant to do so during his first term as president. Much of his energy in those years he was devoting to the business of winning reelection. Above all, he was working to ensure that the conservative Republican Old Guard, which bristled at even the most modest of reforms, would not block his nomination in 1904.By skillfully dispensing patronage to conservatives and progressives alike, by reshuffling the leadership of unstable Republican organizations in the South, by winning the support of Northern businessmen while making adroit gestures to reformers, he succeeded in all but neutralizing his opposition within the party and won its presidential nomination with ease. And in the general election, where he faced a pallid conservative Democrat, Alton B. Parker, he stormed to one of the largest victories in the nation's history. Roosevelt captured over 57 percent of the popular vote and lost not one state outside the South. Now, relieved of immediate political concerns, he was free to display the full extent (and the real limits) of his commitment to reform.

During the 1904 campaign, Roosevelt boasted that he had worked in the anthracite coal strike to provide everyone with a "square deal." In his second term, he became more aggressive in his efforts to extend the square deal even further. Among his most important targets was the powerful railroad industry. The Interstate Commerce Act of 1887, establishing the Interstate Commerce Commission (ICC), had been an early effort to regulate the industry; but over the years, the courts had virtually nullified its influence. Roosevelt asked Congress for a law that would considerably increase the government's power to set railroad rates. In June 1906, the Hepburn Railroad Regulation Act became law, although not until after the Senate had greatly weakened a much stronger bill passed by the House. It was a classic example of the cautiousness with which Roosevelt, even after his 1904 mandate, approached reform. The bill satisfied even many conservatives; and it infuriated advanced progressives such as La Follette, who never forgave Roosevelt for the concessions he made.

The Hepburn Act was the most conspicuous reform legislation of Roosevelt's second term, but only one of many new regulatory measures. The president won approval of laws providing for compensation by employers to injured workers in the District of Columbia and certain other limited areas. He pressured Congress to enact the Pure Food and Drug Act, which, despite weaknesses in its enforcement mechanisms, did restrict the sale of some dangerous or ineffective medicines. When Upton Sinclair's powerful novel The Jungle appeared in 1906, featuring appalling descriptions of the preparation of meats in the nation's stockyards, Roosevelt insisted on passage of the Meat Inspection Act, which ultimately helped eliminate many diseases once transmitted in impure meat.

Starting in 1907, moreover, he seemed to expand his vision of regulation and began to propose even more stringent measures: an eight-hour day for workers, broader compensation for victims of industrial accidents, inheritance and income taxes, regulation of the stock market, and others. In the process, he started openly to criticize conservatives in Congress, who were blocking much of this legislation, and to denounce the judiciary, which was striking down or weakening many of the measures that did pass. The result was not only a general stalemate in Roosevelt's reform agenda, but a widening gulf between the president and the conservative wing of his party.

Conservation

Nothing contributed more to the creation of that gulf than Roosevelt's aggressive policies on behalf of conservation. An ardent sportsman and naturalist, he had long been concerned about the unregulated exploitation of America's natural resources and the despoiling of what remained of the nation's wilderness. Using executive powers, he began early in his presidency to restrict private development on millions of acres of undeveloped land still controlled by the government, adding them to the hitherto modest system of national forests. When vigorous conservative and Western opposition finally resulted in legislation in 1907 to restrict his authority over public lands, Roosevelt and his chief forester, Gifford Pinchot, worked furiously to seize all the forests and many of the water power sites still in the public domain, before the bill became law.

Roosevelt was the first president to take an active interest in the new and struggling American conservation movement, and his policies had a lasting effect on national environmental policies. More than most public figures, he was sympathetic to the concerns of the naturalists—those within the movement committed to protecting the natural beauty of the land and the health of its wildlife from human intrusion. Early in his presidency, Roosevelt even spent four days camping in the Sierras with John Muir, the nation's leading preservationist and the founder of the Sierra Club. In the end, however, Roosevelt's policy tended to favor less the preservationists than another faction within the conservation movement—those who believed in carefully managed development.

The leading conservation figure in government was Pinchot, who became the first director of the National Forest Service (which he helped to create). The first professionally trained American forester, Pinchot supported rational and efficient human use of the wilderness. The Sierra Club might argue for the "aesthetic" value of the forests; Pinchot insisted, in contrast, that ''the whole question is a practical one." He and Roosevelt both believed that trained experts in forestry and resource management, such men as Pinchot himself, should apply to the landscape the same scientific standards that others were applying to the management of cities and industries. The president did side with the preservationists on certain issues, but the more important legacy of his conservation policy was to establish the government's role as manager of the continuing development of the wilderness.

To much of the Old Guard, the extension of government control over vast new lands smacked of socialism. Even worse, Roosevelt's use of executive powers to achieve that control smacked of dictatorship. Many of these same interests, however, displayed no such scruples in supporting another important aspect of Roosevelt's natural resource policy: public reclamation and irrigation projects. In 1902, the president supported the Newlands Reclamation Act, which provided federal funds for the construction of huge dams, reservoirs, and canals in the West—projects to open new lands for cultivation and provide cheap electric power. It was the beginning of many years of federal aid for irrigation and power development in the Western states.

The Panic of 1907

The flurry of reforms Roosevelt was able to enact, and the enormous popularity he attracted as a result, made it easy for members of his administration to believe that finally the government had imposed a strong, effective set of regulations on the new industrial economy. But in fact, the Roosevelt record— although substantial when compared with that of his predecessors—was a relatively modest one, and the economy at large remained essentially uncontrolled. That truth was harshly brought home to Roosevelt and his allies in 1907, when a serious panic and recession revealed how flawed the nation's economic structure remained. The scenario was eerily familiar to those who remembered 1893. Once again, American industrial production had outrun the capacity of cither domestic or foreign markets to absorb it. Once again, the banking system and the stock market had displayed pathetic inadequacies. Once again, irresponsible speculation and rampant financial mismanagement had helped to shatter a prosperity that many had come to believe was now permanent. Banks failed; industries cut or ceased production; workers suffered layoffs and wage cuts.

To many conservatives, Roosevelt's "mad" economic policies were the obvious cause of the disaster. The president, naturally (and correctly), disagreed. But the panic was clearly unnerving to him, and he acted quickly to reassure business leaders that he would not interfere with their recovery efforts. J. P. Morgan, in a spectacular display of his financial power, helped construct a pool of the assets of several important New York banks to prop up shaky financial institutions. The key to the arrangement, Morgan told the president, was the purchase by U.S. Steel of the shares of the Tennessee Coal and Iron Company, currently held by a threatened New York bank. He would, he insisted, need assurances that no antitrust action would ensue. Roosevelt tacitly agreed, and the Morgan plan proceeded- Whether or not as a result, the panic soon subsided.

The Roosevelt Retirement

Theodore Roosevelt loved being president. He had made that plain during his first moments in office, when, torn between his excitement at his new position and his distress at McKinley's death, he had written, "It is a dreadful thing to come into the Presidency in this way; but it would be a far worse thing to be morbid about it." As his years in office produced increasing political successes, as his public popularity continued to rise, more and more observers began to doubt that he would happily stand aside in 1908.

Events, however, dictated otherwise. The Panic of 1907, combined with Roosevelt's growing "radicalism" during his second term, had deeply alienated conservatives in his own party. He would, he realized, have considerable difficulty winning the Republican nomination for another term. In 1904, moreover, he had made a public promise to step down four years later, a promise that would surely emerge to haunt him if he decided to run again. And so, after nearly eight energetic years in the White House, during which he had transformed the role of the presidency in American government, Theodore Roosevelt, fifty years old, retired from public life— briefly.

The Troubled Succession

Yet even had Taft been the most dynamic of political figures, he would still have had difficulties, for he quickly found himself in the middle of a series of political controversies from which no leader could emerge unscathed. Having come into office as the darling of progressives and conservatives alike, he soon found that he could not please them both. Gradually he found himself, without really intending it, pleasing the conservatives and alienating the progressives.

It seemed at first that William Howard Taft, who assumed the presidency in 1909, would be that rare thing among politicians: a leader acceptable to virtually everyone. He had been Theodore Roosevelt's most trusted lieutenant and his hand-picked successor; progressive reformers believed him to be one of their own. But he had also been a restrained and moderate jurist, a man with a punctilious regard for legal process; conservatives expected him to abandon Roosevelt's aggressive use of presidential powers.

It was perhaps unsurprising, then, that in 1908 Taft won election to the White House with almost ridiculous ease. With the support of both Roosevelt and much of the Republican Old Guard, he received his party's nomination virtually uncontested. His victory in the general election in November—over William Jennings Bryan, running forlornly for the Democrats for the third time—was a foregone conclusion. Taft entered the White House on a wave of good feeling.

It was ironic, therefore, that four years later Taft would leave office the most decisively defeated president of the twentieth century, his party deeply, perhaps irrevocably, divided, and the government in the hands of a Democratic administration for the first time in twenty years.

It had been obvious from the start that Taft and Roosevelt were not at all alike, but it was not until Taft took office that the real extent of the differences became clear. Roosevelt had been the most dynamic public figure of his age; Taft was stolid and respectable and little more. Roosevelt was an ardent sportsman and athlete; Taft was sedentary and obese—he weighed over 300 pounds and required a special, oversized bathtub to be installed in the White House. Most of all, Roosevelt had taken an expansive view of the powers of his office; Taft, in contrast, was slow, cautious, even lethargic, insistent that the president must take pains to observe the strict letter of the law.

Congress and the Tariff

The first fiasco occurred in the opening months of the new administration, when Taft called Congress into special session to enact legislation lowering protective tariff rates. Tariff reduction had been a consistent demand of many progressives for nearly a decade. It had reflected less a belief in free trade than a conviction that foreign competition would weaken the power of the great trusts and thus lower domestic prices. Theodore Roosevelt had made several tentative gestures on behalf of tariff reform but had always pulled away from the issue in the end. Taft was determined to do more.

But the president soon proved completely ineffectual in challenging the power of the congressional Old Guard, which remained committed to protection. At times, he seemed not even to be trying to challenge them. A tariff revision acceptable to most progressives moved relatively easily through the House; but in the Senate, Nelson Aldrich and other conservatives, aided by the relentless efforts of protectionist lobbies, waged a powerful campaign to weaken the bill. Progressives battling for revision needed help from the White House. They never received it. Taft believed it would violate the constitutional doctrine of separation of powers if he were to intervene in legislative matters. On August 5, 1909, the president signed the ineffectual Payne-Aldrich Tariff, which reduced tariff rates scarcely at all and in some areas actually raised them. It had been passed without the support of the Midwestern reformers.

The wedge between Taft and the Republican progressives was driven deeper as a result of the president's role in efforts to reform the House of Representatives. The almost dictatorial power of Speaker Joseph Cannon had been a thorn in the side of progressives for many years; Taft himself harbored a strong dislike for the aging "Uncle Joe." So when reformers began a campaign during the 1909 special session to limit the Speaker's power, Taft at first expressed cautious approval. He soon found, however, that without Cannon's support, his tariff legislation faced almost certain death, and he backed away from the insurgent revolt. Again, congressional progressives watched their reform efforts collapse; again, they blamed Taft for betraying them. The following year, after a fierce debate that raged for nearly thirty hours, progressive Republicans under the leadership of George W. Norris finally succeeded in stripping Cannon of some of his most important powers. Even then, however, they acted without the president's support.

The Pinchot-Ballinger Affair

With Taft's standing among Republican progressives steadily deteriorating and with the party growing more and more deeply divided, a sensational controversy broke out late in 1909 that helped to destroy for good Taft's popularity with admirers of Theodore Roosevelt. Many progressives had been unhappy when Taft replaced Roosevelt's secretary of the interior, James R. Garfield, an aggressive conservationist, with Richard A. Ballinger, a corporate lawyer and a far less fervent environmentalist. Suspicion of Ballinger grew when he attempted to invalidate Roosevelt's actions in removing nearly 1 million acres of forests and mineral reserves from the public lands available for private development.

In the midst of this mounting concern, Louis Glavis, an Interior Department investigator, uncovered information that he believed constituted proof that the new secretary had once connived to turn over valuable coal lands in Alaska to a private syndicate in exchange for personal profit. Glavis took the evidence to Gifford Pinchot, who had remained as head of the Forest Service and had been appalled by Ballinger's retreat from Roosevelt's policies. Pinchot took the charges to the president. Taft listened to Pinchot, heard Ballinger's rebuttal, asked Attorney General George Wickersham to investigate, and finally announced his support for his interior secretary. The charges, he insisted, were groundless.

Pinchot, however, was not satisfied. Unhappy that Ballinger remained in office and angry when Taft fired Glavis for his part in the episode, he leaked the story to the press and appealed directly to Congress to investigate the scandal. The president quickly discharged him for insubordination, and the congressional committee appointed to study the controversy, dominated by the Old Guard, exonerated Ballinger. But Taft's victory had come at a high cost. Progressives throughout the country rallied to the support of Pinchot, whom they considered the defender of the public interest against selfish business interests. Taft, in contrast, appeared to have capitulated to conservatives and to have repudiated the legacy of Theodore Roosevelt. The controversy aroused as much public passion as any dispute of its time; and when it was over, Taft had alienated the supporters of Roosevelt as completely as his tariff actions had alienated the followers of La Follette.

The Return of Roosevelt

During most of Taft's first year in office, Theodore Roosevelt was far from the political fray. He embarked first on a long hunting safari in the jungles of Africa; from there he traveled to Europe for visits to the major heads of state. To the American public, however, Roosevelt remained a formidable presence. Reports of his triumphant European tour dominated the front pages of newspapers across the country. Rumors that he would return to retake control of his party abounded. His arrival in New York in the spring of 1910 was a major public event; and progressives noted that, although he turned down an invitation from Taft to visit the White House, he met at once with Gifford Pinchot (who had already traveled to England to see him several months before).

Roosevelt insisted that he had no plans to return to active politics, but his resolve lasted less than a week. Politicians began flocking immediately to his home at Oyster Bay, Long Island, for conferences; Roosevelt himself took an active role in several New York political controversies; and within a month, he announced that he would embark on a national speaking tour before the end of the summer. Furious with Taft, who had, he believed, "completely twisted around the policies I advocated and acted upon," he was becoming convinced that he alone was capable of reuniting the Republican party.

The real signal of Roosevelt's return to active leadership of the progressives was a speech on September 1, 1910, in Osawatomie, Kansas, where he outlined a set of principles that he labeled the "New Nationalism." The speech made clear how far Roosevelt had moved from the cautious conservatism that had marked the first years of his presidency. Social justice, he argued, could be attained only through the vigorous efforts of a strong federal government whose executive acted as the "steward of the public welfare." Those who thought primarily of property rights and personal profit "must now give way to the advocate of human welfare, who rightly maintains that every man holds his property subject to the general right of the community to regulate its use to whatever degree the public welfare may require it." Such generalizations were frightening enough by themselves to the Republican Old Guard, but Roosevelt went beyond them with a list of "radical" specific proposals: graduated income and inheritance taxes, workers' compensation for industrial accidents, regulation of the labor of women and children, tariff revision, and firm regulation of corporations through a more powerful Bureau of Corporations and ICC.

Spreading Insurgency

The congressional elections of 1910 provided further evidence of how far the progressive revolt had spread. In primary elections, conservative Republicans suffered defeat after defeat at the hands of progressive insurgents—forty in the House of Representatives alone. Incumbent progressives, moreover, won renomination almost without exception. In the general election, the Democrats, who were increasingly offering progressive candidates of their own, won control of the House of Representatives for the first time in sixteen years and greatly strengthened their position in the Senate. Progressivism appeared to have become a tidal wave. Still, Roosevelt continued to deny any presidential ambitions and to claim that his real purpose was to pressure Taft to return to progressive policies. Two events, however, changed his mind.

The first was a 1911 decision by the Taft administration that became, in Roosevelt's eyes, the final, inexcusable indignity. With his strong respect for the letter of the law, Taft had been far more active than Roosevelt in enforcing the provisions of the Sherman Antitrust Act and had launched dozens of suits against corporate combinations. To Roosevelt, such actions were troubling by themselves, for they reflected what he believed to be a wholly unrealistic attempt to abolish trusts when the proper course was to regulate them. But what truly outraged him was the announcement on October 27, 1911, that the administration was filing an antitrust suit against U.S. Steel, charging, among other things, that the 1907 acquisition of the Tennessee Coal and Iron Company had been illegal. Roosevelt had approved that acquisition in the midst of the 1907 panic, and he was enraged by the implication that he had acted improperly.

There remained, however, a major obstacle to Roosevelt's pursuit of the presidency. Since January 1911, Robert La Follette had been working through the newly formed National Progressive Republican League to secure the presidential nomination for himself. Many reformers believed he had established first claim to the leadership of any insurgent revolt, and Roosevelt was at first reluctant to challenge him. But La Follette's candidacy stumbled in February 1912, when, exhausted and plagued by personal worries (including the illness of his daughter), he appeared to suffer a nervous breakdown during a speech in Philadelphia. With almost indecent haste, many of his supporters abandoned him and turned to Roosevelt, who finally announced his candidacy on February 22.

TR Versus Taft

La Follette never forgave Roosevelt for "using" and then "betraying" him, and some diehard loyalists refused to abandon their allegiance to the Wisconsin senator. But for all practical purposes, the campaign for the Republican nomination had now become a battle between Roosevelt, the champion of the progressives, and Taft, the candidate of the conservatives. Roosevelt scored overwhelming victories in every presidential preference primary (there were thirteen in all) and arrived at the convention convinced that he had proved himself the choice of the party rank and file. Taft, however, remained the choice of most party leaders, and in the end it was their preference that proved decisive.

The battle for the nomination at the Chicago convention revolved around an unusually large number of contested delegates: 254 in all. Roosevelt needed about 100 of the disputed seats to clinch the nomination. But the Republican National Committee, which ruled on credentials, was controlled by members of the Old Guard; and it awarded all but 19 of the disputed seats to Taft. Roosevelt and his followers responded bitterly. The decision to seat the Taft delegates, they claimed, was an example of the same corrupt politics that progressives had been fighting for years; once more the people had been thwarted by the special interests. At a rally the night before the convention opened, Roosevelt addressed 5,000 madly cheering supporters and announced that he would not feel bound by the decision of his party if it refused to seat his delegates, that he would continue to fight for a candidacy that had now, it seemed, become a holy cause. "We stand at Armageddon," he told the roaring crowd, "and we battle for the Lord." As good as his word, Roosevelt the next day led his supporters out of the convention, and out of the party. Taft was then quietly nominated on the first ballot. With financial support from newspaper magnate Frank Munsey and industrialist George W. Perkins, Roosevelt summoned his supporters back to Chicago in August for another convention, this one to launch the new Progressive party and nominate Roosevelt as its presidential candidate. By now, even Roosevelt was aware that the cause was virtually hopeless, particularly when many of the leading insurgents who had supported him during the primaries refused to follow him out of the Republican party. Nevertheless, he approached the battle feeling, as he put it, "fit as a bull moose" (thus giving his new party an enduring nickname). At the meeting in Chicago, he delivered a resounding "Confession of Faith" in which he castigated both of the traditional parties for representing "government of the needy many by professional politicians in the interests of the rich few"; and he produced a platform that embodied a full array of the most advanced progressive reforms.

Woodrow Wilson and the New Freedom

Yet even while Roosevelt was constructing his New Nationalism as a challenge to conservatives within his own party, another pGwerful alternative was emerging from the ranks of the Democrats. The contest, it soon became clear, was not simply one between conservatives and reformers; it was also one between two brands of progressivism, expressing two apparently different views of America's future.

Woodrow Wilson

For most of the first decade of the century, the Republican party had often seemed the sole home of progressive reform. In fact, however, progressive sentiment had been gaining strength within the Democratic party as well; and by 1912 it was ready to assert its dominance. At the Democratic convention in Baltimore in June, Champ Clark, the conservative Speaker of the House, was the early favorite for the presidential nomination. He controlled a majority of the delegates; but on ballot after ballot he failed to assemble the two-thirds necessary to win. For days the battle dragged on until finally, on the forty-sixth ballot, Woodrow Wilson, the governor of New Jersey, emerged as the party's nominee. His victory was in part a result of the last-minute support of Senator Oscar Underwood of Alabama, who had himself been one of the leading contenders for the nomination, and of William Jennings Bryan, who was to become Wilson's secretary of state. It was also, however, a result of Wilson's position as the only genuinely progressive candidate in the race.

Born in Virginia and raised in Confederate Georgia and Reconstruction South Carolina, Wilson had risen to political prominence by an unusual path. An 1879 graduate of Princeton University, he attended law school and for a time engaged unhappily in practice in Atlanta. He was, however, really more interested in politics and government, and after a few years he enrolled at Johns Hopkins University, where he earned a doctorate in political science. By virtue of his effective teaching and his lucid if unprofound books on the American political system, he rose steadily through the academic ranks until in 1902 he was promoted from the faculty to the presidency of Princeton. There, he displayed both the strengths and the weaknesses that would characterize his later political career. A champion of academic reform, he acted firmly and energetically to place Princeton on the road to becoming a great national university. At the same time, however, he displayed during controversies a self-righteous morality that at times made it nearly impossible for him to compromise.

It was a series of such stalemates that propelled him out of academia and into politics. Elected governor of New Jersey in 1910, he brought to his new office the same commitment to reform that he had displayed in the past; and during his two years in the statehouse, he compiled an impressive record of progressive legislation—one that earned him a wide national reputation. At the same time, however, he was gradually alienating conservative party leaders with his intransigence and self-righteousness, and greatly hampering his ability to govern. His nomination for president in 1912 rescued him from what might well have become a political disaster in New Jersey.

In later years, Wilson's personal characteristics would help polarize the nation. In 1912, however, he sparked controversy by presenting a brand of pro-gressivism that was both forceful and sharply different from Theodore Roosevelt's New Nationalism. His supporters soon began to describe Wilson's program as the "New Freedom"; and although in later years the two phrases began to seem like meaningless slogans, reflecting few important differences, the opposing philosophies—"nationalism'' versus "freedom' '—were in fact distinct from each other in important ways.

In its narrowest sense, Wilson's New Freedom differed from Roosevelt's New Nationalism in its approach to economic policy, in particular its approach to the trusts. Roosevelt had always believed in accepting economic concentration and using government to regulate and control it. Wilson, in contrast, appeared to be a disciple of Louis Brandeis's approach to economic reform. He sided with those who believed that bigness was both unjust and inefficient, that the proper response to monopoly was not to regulate it but to destroy it.

The Election of 1912

Despite the philosophical importance of the issues in 1912, the campaign itself was surprisingly uneventful. Voters seemed generally unaware of the ideological differences between Roosevelt and Wilson, and the election in the end reflected traditional party divisions.

It was a three-candidate election but a two-candidate campaign. William Howard Taft, resigned to defeat, delivered a few desultory, conservative speeches and then lapsed into silence. "There are so many people in the country who don't like me," he sadly explained. Roosevelt campaigned energetically (until a gunshot wound from a would-be assassin forced him to the sidelines during the last weeks before the election), and he continued to generate excitement among his Republican followers- He failed, however, to draw any significant numbers of Democratic progressives away from Wilson, who as the campaign wore on was beginning to evoke an enthusiastic national following of his own. The results in November were, therefore, predictable. Roosevelt and Taft split the Republican vote; Wilson held onto the Democratic vote and won. He polled only a plurality of the popular vote: 42 percent, to 27 percent for Roosevelt and a dismal 23 percent for Taft. Eugene Debs, the Socialist candidate, received 6 percent of the vote. But in the electoral college, Wilson won by a landslide: 435 of the 531 votes. Roosevelt had carried only six states, Taft only two.

The Scholar as President

The administration of Woodrow Wilson ended unhappily, both for the president and for the nation. It began, however, in triumph. For nearly five years, until international problems turned his attention elsewhere, Wilson served as the most successful leader of domestic reform of his era.

Wilson brought to the White House a conception of the presidency based on long years of scholarly study. His first published book, Congressional Government (1898), expressed what remained a lifelong admiration for the British parliamentary system and a belief in its adaptability to American institutions. In his later writings, however, he began to display more interest in the possibilities of presidential leadership.

"His is the only voice in national affairs," he wrote of the president only four years before he himself assumed the office. His must therefore be the voice of popular aspirations, the hand that guides public demands into legislative realities.

More than William Howard Taft, therefore, more even than Theodore Roosevelt, Wilson concentrated the powers of the executive branch in his own hands. He exerted firm control over his cabinet, and he delegated real authority only to those whose loyalty to him was beyond question. Perhaps the clearest indication of his style of leadership was the identity of the most powerful figure in his administration: Colonel Edward M. House, a man who held no office and whose only claim to authority was his personal intimacy with the president.

In his dealings with Congress, he proved unusually adept at using his position as head of his party to pressure and cajole members of Congress into supporting his positions. He used his appointive powers to weld together a coalition of conservatives and progressives who would, he believed, support his program. His task was eased by the existence of Democratic majorities in both houses of Congress and by the realization of many Democrats that the party must enact a progressive program in order to maintain those majorities.

Tariffs and Taxes

Wilson's first triumph as president was the fulfillment of an old Democratic and progressive promise—a substantial lowering of the protective tariff. Roosevelt had avoided the issue; Taft had failed at it. Wilson moved quickly and forcefully to succeed. On the day he took office, he called a special session of Congress. And when it met, he did what no president since Jefferson had done: He appeared before it in person to ask for genuine tariff reform. The Underwood-Simmons Tariff provided cuts substantial enough, progressives believed, to introduce real competition into American markets and thus to help break the power of trusts. It passed easily in the House; and despite Senate efforts to weaken its provisions, the bill survived more or less intact. Wilson's forceful exercise of party powers mobilized virtually the entire Democratic majority behind it.

To make up for the loss of revenue under the new tariff, Representative Cordell Hull of Tennessee drafted an amendment to the bill that provided for a graduated income tax, which the recently adopted Sixteenth Amendment to the Constitution now permitted. This first modern income tax imposed a 1 percent tax on individuals and corporations earning over $4,000, with rates ranging up to 6 percent on incomes over $500,000. It was the beginning of a fundamental change in the American tax structure.

Banking Reform

President Wilson held Congress in session through the sweltering summer to begin work on a major reform of the American banking system. "The great monopoly in this country," he had declared in 1911, "is the money monopoly. So long as that exists, our old variety and freedom and individual energy of development are out of the question." Few progressives would have disagreed, but there were wide differences of opinion about how best to attack the problem.

Some legislators, of whom Representative Carter Glass of Virginia was one, wanted to decentralize control of the banking system so as to limit the power of the great Wall Street financiers but still leave ultimate authority over it with the bankers themselves. Others, whose hatred of the "money trust" was more intense—for example, William Jennings Bryan and fellow agrarians—wanted firm government control. After consultation with Louis Brandeis, Wilson accepted a plan that divided power in the system. The government would have substantial control at the national level; the bankers would retain control at the local level. With Bryan mediating and Wilson brandishing every presidential weapon in his arsenal, a banking reform bill passed both houses of Congress and was signed by the president on December 23, 1913. It was the most important piece of domestic legislation of Wilson's administration.

The Federal Reserve Act of 1913 created twelve regional banks, each to be owned and controlled by the individual banks of its district. The regional Federal Reserve banks would hold a certain percentage of the assets of their member banks in reserve; they would use those reserves to support loans to private banks at an interest (or "discount") rate that the Federal Reserve system would set; they would issue a new type of paper currency—Federal Reserve notes— which would become the nation's basic medium of trade and be backed by the government. Most important, perhaps, they would serve as central institutions able to shift funds quickly to troubled areas—to meet increased demands for credit or to protect imperiled banks. Supervising and regulating the entire system was a national Federal Reserve Board, whose members were appointed by the president. All "national" banks were required to join the system; smaller banks were encouraged to do the same. Within a year, nearly half the nation's banking resources were represented in the system; by the late 1920s, the proportion had swelled to 80 percent.

For all its limitations, and there were many, the Federal Reserve Act marked a notable advance in American banking practices, historically among the least stable and efficient in the Western world. And it provided the government, through the Federal Reserve Board, with a powerful instrument of economic influence—although it was not until many years later that economists recognized the power that control over the nation's money supply provided. The Great Depression of the 1930s would prove that, despite these changes, the American banking structure remained weak and unstable; but the Federal Reserve Act was an important first step toward the stabler system that ultimately emerged.

The Problem of the Trusts

The cornerstone of Wilson's campaign for the presidency had been his promise to attack economic concentration, most notably to destroy monopolistic trusts. By the beginning of his second year in office, however, it was becoming clear that his thinking had changed significantly. He was moving away from his earlier insistence that government dismantle the combinations and toward a commitment to regulating them. On this issue, at least, the New Freedom was giving way to the New Nationalism.

Wilson's attitude toward several major pieces of economic legislation symbolized the trend. When in 1914 he began to promote a sweeping plan to deal with the problem of monopoly, two elements emerged at its core. There was a proposal to create a federal agency through which the government would help business police itself—in other words, a regulatory commission of the type Roosevelt had advocated in 1912. There were, in addition, proposals to strengthen the government's power to prosecute and dismantle the trusts—a decentralizing approach more characteristic of Wilson's campaign. The two measures took shape, ultimately, as the Federal Trade Commission Act and the Clayton Antitrust Act.

Wilson fought hard for the Federal Trade Commission Act, which created a regulatory agency of the same name, and he signed it happily when it arrived at the White House. The new commission would, he promised, remove "uncertainty"' within the corporate community, allowing businesses to determine in advance whether their actions would be acceptable to the government. It would also have authority to launch prosecutions against "unfair trade practices," which the law did not define, and it would have wide power to investigate corporate behavior. The act, in short, increased the government's regulatory authority significantly. But Wilson seemed to lose interest in the Clayton Antitrust bill and showed a notable lack of vigor in fighting to protect it from conservative assaults, which greatly weakened its potential effectiveness. When the emasculated bill finally reached his desk, he lauded it as a major accomplishment.

Nor did Wilson act very forcefully within the executive branch to prosecute the trusts. The relative ineffectiveness of the new Federal Trade Commission—to which Wilson appointed men so inept or so sympathetic to the trusts they were supposed to regulate that Brandeis once dismissed them as useless and "stupid"—was one indication of his attitude. And the Justice Department remained less than aggressive in its pursuit of illegal combinations. The vigorous legal pursuit of monopoly that Wilson had promised in 1912 never materialized. The future, he had apparently decided, lay with government supervision.

Retreat and Advance

By the fall of 1914, Wilson believed that the program of the New Freedom was essentially complete and that the agitation for reform would now subside. As a result, he himself began a conspicuous retreat from political activism. Citing the doctrine of states' rights, he declined to support the movement for woman suffrage. Accepting the inclinations of the many Southerners in his cabinet, he condoned the reim-position of segregation in the agencies of the federal government (a sharp contrast to Theodore Roosevelt, who had ordered the elimination of many such barriers and had even taken the unprecedented step of inviting a black man—Booker T. Washington—to the White House). When congressional reformers attempted to enlist his support for new social legislation, he breezily dismissed their proposals as unconstitutional or unnecessary.

The president's complacency could not, however, long survive the congressional elections of 1914. It was disturbing enough that Democrats suffered major losses in the House of Representatives. But it was even more alarming that voters who had in 1912 supported the Progressive party were returning in droves to the Republicans. Wilson would not be able to rely on a divided opposition when he ran for reeelection in 1916; he would need more than his 1912 total of 42 percent of the vote, and he would need the support of some of Theodore Roosevelt's former constituency to get it.

By the end of 1915, therefore, Wilson had shed his lethargy and begun to support a second flurry of reforms. In January 1916, he appointed Louis Brandeis to the Supreme Court, making him not only the first Jew but the most advanced progressive to be so named; and he weathered a conservative uproar in the Senate to obtain Brandeis's confirmation. Later, he supported a measure to make it easier for farmers to receive credit and one creating a system of workers' compensation for federal employees.

The real significance of this renewed effort at reform was that Wilson seemed now to have capitulated to the New Nationalism almost entirely; indeed, he had moved beyond it. No longer was the president appealing for the restoration of a competitive, decentralized economy. No longer was he warning about excessive federal power. Instead, Wilson was sponsoring measures that expanded the role of the national government in important ways, giving it new instruments by which it could not only regulate the economy but help shape the economic and social structure itself.

In 1916, for example, Wilson supported the Keating-Owen Act, the first federal law regulating child labor. It was important not only for the problem it addressed but for the means it adopted. The measure prohibited the shipment of goods produced by underage children across state lines, thus giving a new and expanded importance to the constitutional clause assigning Congress the task of regulating interstate commerce. (It would be some years before the Supreme Court would uphold this interpretation of the clause; the Court invalidated the Keating-Owen Act in 1918.) The president similarly supported measures that used federal taxing authority as a vehicle for legislating social change. When the Court struck down Keating-Owen, a new bill attempted to achieve the same goal by imposing a heavy tax on the products of child labor. (The Court later struck it down too.) The government's spending authority likewise became an instrument of social control. The Smith-Lever Act, for example, had as early as 1914 offered matching federal grants to states that agreed to support agricultural extension education.

Wilson had, by the end of his first term, made significant strides toward expanding the role of the federal government in American society. He had accepted the importance of orderly bureaucratic procedures and enlightened expertise in governing an industrial society, and he had backed away from his earlier vision of a nation liberated from centralized controls. It was not, as one conservative congressman charged, "the first step away from the democracy of Thomas Jefferson ... to the socialism of Karl Marx." But it was an important step toward the creation of the modern state.

The "Big Stick": America and the World, 1901-1917

American foreign policy during the progressive years reflected many of the same impulses that were motivating domestic reform. But it reflected far more clearly the nation's new sense of itself as a world power with far-flung economic and political interests. To the general public, foreign affairs remained largely remote. Walter Lippmann once wrote: "I cannot remember taking any interest whatsoever in foreign affairs until after the outbreak of the First World War." But to Theodore Roosevelt and later presidents, that made foreign affairs even more appealing. There the president could act with less regard for the Congress or the courts. There, he could free himself from concerns about public opinion. Overseas, the president could exercise power unfettered and alone.

SeaPower and Civilization

Theodore Roosevelt was well suited, both by temperament and by ideology, for an activist foreign policy. A vigorous athlete and once an enthusiastic college boxer, he spoke often of the virtues of the ''strenuous life" and viewed physical combat as an ennobling, manly challenge. His fondness for battle had been greatly enhanced by his famous charge up San Juan Hill, a crucial event in the development of his political career.

Roosevelt believed, moreover, that an important distinction existed between the "civilized" and "uncivilized" nations of the world. "Civilized" nations, as he defined them, were predominantly white and Anglo-Saxon or Teutonic; "uncivilized" nations were generally nonwhite, Latin, or Slavic. But racism was only partly the basis of the distinction. At least as important was economic development. Thus it was that Japan, a rapidly industrializing society, seemed to Roosevelt to have earned admission to the ranks of the civilized.

There was another important aspect of this global division. Civilized nations were, by Roosevelt's definition, producers of industrial goods; uncivilized nations were suppliers of raw materials and markets. There was, he believed, an economic relationship between the two parts that was vital to both of them; and it was natural, perhaps, that he should come to believe in the right and duty of the civilized societies to intervene in the affairs of "backward" nations to preserve order and stability. The economic health of the globe might depend on the result.

Accordingly, Roosevelt early became an outspoken champion of the development of American sea power. A friend and admirer of Alfred Thayer Mahan, Roosevelt had believed since his days as assistant secretary of the navy in 1897 that the United States must move rapidly to expand the size and power of its fleet. By 1906, Roosevelt's support had enabled the American navy to attain a size and strength surpassed only by that of Great Britain (although Germany was fast gaining ground).

Challenges in Asia

The new strength was not, however, always enough to enable the president to have his way in global developments, as events in the Pacific soon illustrated. Roosevelt believed that the "Open Door" was vital to maintain American trade in the Pacific and to prevent any single nation from establishing dominance there. (See above, pp. 592-593.) He looked with alarm, therefore, at the military rivalries involving Japan, Russia, Germany, and France in the region. He was particularly concerned by Russian efforts to expand southward into Manchuria, a province of China; and when in 1904 the Japanese attacked the Russian fleet at Port Arthur in southern Manchuria, Roosevelt, like most Americans, was inclined to approve. Yet the president was no more eager for Japan to control Manchuria than for Russia to do so. In 1905, therefore, he eagerly agreed to a Japanese request to mediate an end to the conflict. Russia, faring badly in the war—and, as a result, already experiencing a domestic instability that twelve years later would culminate in revolution—had no choice but to agree.

At a peace conference in Portsmouth, New Hampshire, Roosevelt extracted from the embattled Russians a recognition of Japan's territorial gains— control of Korea, South Manchuria, and part of Sakhalin Island, formerly a Russian outpost. Japan, in return, agreed to cease the fighting and expand no further. At the same time, Roosevelt worked to secure American interests by negotiating a secret agreement with the Japanese to ensure that the United States could continue to trade freely in the region.

Roosevelt was pleased with his work at the Portsmouth Conference, particularly when it helped him to win the Nobel Peace Prize in 1906. But his triumph was, in fact, a hollow one. In the years that followed, relations between the United States and Japan steadily deteriorated, and the careful assurances Roosevelt had won in 1905 proved all but meaningless. Having destroyed the Russian fleet at Port Arthur, Japan now emerged as the preeminent naval power in the Pacific and soon began to exclude American trade from many of the territories it controlled.

It did not help matters that in 1906 the school board of San Francisco voted to segregate Oriental schoolchildren in the city in separate schools; or that a year later, the California legislature attempted to pass legislation limiting the immigration of Japanese laborers into the state. Anti-Oriental riots in California and inflammatory stories in the Hearst papers about the "Yellow Peril" further fanned resentment in Japan. The president did his best to douse the flames. He quietly persuaded the San Francisco school board to rescind its edict in return for a Japanese agreement to stop the flow of agricultural immigrants into California. Then, lest the Japanese government construe his actions as a sign of weakness, he sent sixteen battleships of the new American navy on an unprecedented 45,000-mile voyage around the world that included a call on Japan. Despite fears by some members of Congress that a naval conflict might ensue, the "Great White Fleet," as the flotilla was called, received a warm reception when it arrived in Yokohama. For the moment, Roosevelt's foreign policy—which he once summarized with the African proverb: "Speak softly and carry a big stick"—seemed to have borne important fruit. But the problem of Japanese expansion in the Far East had not been resolved, and Japan continued to look for ways to extend its power in the region.

The Iron-Fisted Neighbor

Roosevelt took a special interest in events in what he (and most other Americans) considered the nation's special sphere of interest: Latin America. And very early in his presidency, he become concerned—some believed almost obsessed—by the possibility of German penetration into the region. Unwilling to share trading rights, let alone military control, with any other nation, Roosevelt embarked on a series of ventures in the Caribbean and South America that established a pattern of American intervention in the region that would long survive his presidency.

Crucial to Roosevelt's thinking was an incident early in his administration. When the government of Venezuela began in 1902 to renege on debts to European bankers, naval forces of Britain, Italy, and Germany erected a blockade along that country's coast. Roosevelt at first expressed little concern. But when German ships began to bombard a Venezuelan port and when rumors spread that Germany planned to establish a permanent base in the region, Roosevelt changed his mind. In 1903, he warned the Germans (according to his own later account) that Admiral Dewey and his fleet were standing by in the Caribbean and would act against any German effort to acquire new territory. The German navy finally withdrew.

The incident helped to persuade Roosevelt that European intrusions into Latin America could result not only from aggression but from internal instability or irresponsibility (such as defaulting on debts) within the Latin American nations themselves. As a result, he added a new "corollary" to the Monroe Doctrine. In a 1904 message to Congress, he claimed that the United States had the right not only to oppose European intervention in the Western Hemisphere but to intervene itself in the domestic affairs of its neighbors if those neighbors proved unable to maintain order on their own.

The immediate motivation for the Roosevelt Corollary, and the first opportunity for putting the doctrine into practice, was a crisis in the Dominican Republic. A revolution had toppled the corrupt and bankrupt government of that nation in 1903, but the new regime proved no better able than the old to make good on the country's $22 million of debts to European nations. Both France and Italy were threatening to intervene to recover their losses, and the new Dominican leaders had turned to the United States for help. Using the rationale he had outlined in his address to Congress, Roosevelt established, in effect, an American receivership, assuming control of Dominican customs and distributing 45 percent of the revenues to Santo Domingo and the rest to foreign creditors. This arrangement lasted, in one form or another, for more than three decades.

Two years later, another opportunity for intervention in the Caribbean arose. In 1902, the United States had granted political independence to Cuba, but only after the new government had agreed to the so-called Platt Amendment to its constitution, giving the United States the right to prevent any foreign power from intruding into the new nation. When, in 1906, a series of domestic uprisings seemed to threaten the internal stability of the island, Roosevelt reasoned that America must intervene to "protect" Cuba from disorder. American troops landed in Cuba, quelled the fighting, and remained there for three years.

The Panama Canal

The most celebrated accomplishment of Roosevelt's presidency, and the one that illustrated most clearly his own expansive view of the powers of his office and the role of the United States abroad, was the completion of the Panama Canal. Construction of a channel through Central America linking the Atlantic and the Pacific had been a dream of many nations since the mid-nineteenth century, but somehow the canal had never been built. Roosevelt was determined to do better.

The first step was the removal of an old obstacle. In 1850, the United States and Great Britain had agreed to a treaty under which the two nations would construct, operate, and defend any such canal together. The McKinley administration had already begun negotiations to cancel the agreement; Roosevelt completed the process. In 1901, the Hay-Pauncefote Treaty gave the United States the right to undertake the canal project alone.

The next question was where to locate the canal. At first, the Roosevelt administration (and many congressional leaders) favored a route across Nicaragua, which would permit a sea-level canal requiring no locks. A possible alternative was the Isthmus of Panama in Colombia, the site of an earlier, abortive effort by a French company to construct a channel.

The Panama route was shorter (although not at sea level), and construction was already about 40 percent complete. When the French company lowered its price for its holdings from $109 million to $40 million, and when it combined this gesture with skillful lobbying efforts in Washington, the president and Congress changed their minds.

Roosevelt quickly dispatched John Hay, his secretary of state, to negotiate an agreement with Colombian diplomats in Washington that would allow construction to begin without delay. Under heavy American pressure, the Colombian charge d'affaires, Tomas Herran, signed an agreement considered highly unfavorable to his own nation. The United States would gain perpetual rights to a six-mile-wide "canal zone" across Colombia; in return, it would pay Colombia $10 million and an annual rental of $250,000. The treaty produced outrage in the Colombian Senate, whose members refused to ratify the agreement and sent a new representative to the United States with instructions to demand at least $20 million from the Americans plus a share of the payment to the French.

Roosevelt now was furious. The Colombians, he charged, were "inefficient bandits" and "blackmailers"; and he began to contemplate ways to circumvent the Bogota government. He found a ready ally in the person of Philippe Bunau-Varilla, chief engineer of the French canal project. Bunau-Varilla watched with dismay as the government of Colombia appeared ready to destroy his efforts, and in November 1903 he helped organize and finance a revolution in Panama. There had been many previous revolts, all of them failures. But this one had an important additional asset: the support of the United States. Using an 1846 American-Colombian treaty as justification, Roosevelt landed troops from the U.S.S. Nashville in Panama to "maintain order." Their presence prevented Colombian forces from suppressing the rebellion, and three days later the United States recognized Panama as an independent nation. The new Panamanian government, under the influence of Bunau-Varilla, quickly agreed to a treaty with the United States. It granted America a canal zone ten miles wide; the United States would pay Panama the $10 million fee and the $250,000 annual rental that the Colombian Senate had rejected. Work on the canal proceeded rapidly, despite the enormous cuts and elaborate locks (which alone cost $375 million) that the construction required. It opened in 1914, three years after Roosevelt had proudly boasted to a university audience, "I took the Canal Zone and let Congress debate!"

Taft and "Dollar Diplomacy"

Many of those who had admired Roosevelt's vigorous command of American foreign policy and his strenuous efforts to maintain a world balance of power were dismayed by William Howard Taft's performance in international affairs. Although the new president made no decisive break with the policies of his predecessor, and while in some areas he actually extended American involvement abroad, he was in general no readier to exert strong leadership internationally than he was domestically. He worked to advance the nation's economic interests overseas, but he seemed to lack Roosevelt's larger vision of world stability. Worst of all, several of his most important foreign policy initiatives were conspicuous failures.

The thrust of Taft's foreign policy was best symbolized by the man he chose to administer it: Secretary of State Philander C. Knox, a corporate lawyer committed to using his position to promote American business interests overseas. Roosevelt, of course, had promoted American economic interests too; but Knox seemed at times to regard the State Department as little more than an agent of the corporate community. He worked aggressively to extend American investments into underdeveloped regions, motivating critics to label his policies "Dollar Diplomacy."

The Taft-Knox foreign policy faced its severest test, and encountered its greatest failure, in the Far East. Ignoring Roosevelt's tacit 1905 agreement with Japan to limit American involvement in Manchuria, the new administration succumbed to the persuasive powers of American bankers and began to move aggressively to increase America's economic influence in the region. When British, French, and German bankers formed a consortium to finance a vast system of railroads in China, Knox insisted that Americans should also participate; and when in 1911 the Europeans finally agreed to include the United States in their venture, Knox proposed that an international syndicate purchase the South Manchurian Railroad to remove it from Japanese control. Japan responded by signing a treaty of friendship with Russia—a warning to the Europeans—and the entire railroad project quickly collapsed. Having attempted to expand its influence in Asia, America now found the door to Manchuria slammed in its face.

In the Caribbean, the new administration continued and even expanded upon Roosevelt's policies of maintaining order and stability in troubled areas, without regard for the national integrity of the nations involved. Limiting European influence in the region meant, Taft and Knox believed, not only preventing disorder but establishing a significant American economic presence there—replacing the investments of European nations with investments from the United States. In 1909, Knox tried (unsuccessfully) to arrange for American bankers to establish a financial receivership in Honduras. Later, he persuaded New York bankers to invest in the National Bank of Haiti.

But Dollar Diplomacy was not always so peaceful. When a revolution broke out in Nicaragua in 1909, the administration quickly sided with the insurgents (who had been inspired to revolt by an American mining company) and sent American troops into the country to seize the customs houses. As soon as peace was restored, Knox encouraged American bankers to move into Nicaragua and offer substantial loans to the new government, thus increasing Washington's financial leverage over the country. Within two years, however, the new pro-American government faced a revolt of its own; and Taft again landed American troops in Nicaragua, this time to protect the existing regime. The troops remained there for more than a decade.

Diplomacy and Morality

"It would be the irony of fate," Woodrow Wilson remarked shortly before assuming the presidency, "if my administration had to deal chiefly with foreign affairs." It would also, as it turned out, be a tragedy. Wilson faced international challenges of a scope and gravity unmatched by any president before him; and he brought to his treatment of them not only remarkable vision but an often inflexible, even self-righteous morality that would ultimately destroy both him and many of the goals for which he fought. Although the true ordeal of Wilsonian diplomacy did not occur until after World War I, many of the qualities that would help produce it were evident in his foreign policy from his first moments in office.

Through much of his administration, Wilson made strenuous but generally unsuccessful efforts to maintain an open door for American trade in China and to resist the expansion of Japanese influence in the Pacific. At the same time, however, the United States was itself working energetically to close the door to all nations but itself in Latin America. Wilson presided over a foreign policy that not only continued but greatly increased American intervention in the Caribbean and in Latin America, justifying his actions by citing both economic necessity and moral imperative.

The list of American incursions was lengthy and impressive. Having already seized control of the finances of the Dominican Republic in 1905, the United States established a military government there in 1916 when the Dominicans refused to accept a treaty that would have made the country a virtual American protectorate. The military occupation lasted eight years. In Haiti, which shares the island of Hispaniola with the Dominican Republic, Wilson landed the marines in 1915 to quell a revolution in the course of which a mob had murdered an unpopular president. American military forces remained in the country until 1934, and American officers drafted the new Haitian constitution adopted in 1918. When Wilson began to fear that the Danish West Indies might be about to fall into the hands of Germany, he bought the colony from Denmark and renamed it the Virgin Islands. Concerned about the possibility of European influence in Nicaragua, he signed a treaty with that country's government ensuring that no other nation would build a canal there and winning for the United States the right to intervene in Nicaragua's internal affairs to protect American interests.

In one case after another, the United States was openly disregarding the national integrity of its neighbors, acting instead in response to what Wilson considered a higher mission: the creation of order and, not coincidentally, the protection of American markets and investments. The president had no doubt that the recipients of his attention would become stabler, more democratic nations as a result. In most cases, he was wrong.

Mission in Mexico

It was in Mexico that Wilson's missionary view of America's role in the Western Hemisphere received its greatest test and suffered its greatest frustrations. For many years, under the friendly auspices of dictator Porfirio Diaz, American businessmen had been establishing an enormous presence in Mexico, with investments totaling more than $1 billion. In 1910, however, the corrupt and tyrannical Diaz had been overthrown by the popular leader Francisco Madero, who excited many of his countrymen by promising democratic reform but alarmed many American businessmen by threatening their investments in his country. With the approval of, among others, the American ambassador in Mexico, Madero was himself deposed early in 1913 by a reactionary general, Victoriano Huerta.

A relieved Taft administration prepared, in its last weeks in office, to recognize the new Huerta regime and welcome back a receptive environment for American investments in Mexico. Before it could do so, however, the new government murdered Madero, producing horror and outrage around the world. Wilson, therefore, inherited a difficult and unresolved dilemma. But he displayed no hesitation in responding. He would never, he insisted, recognize Huerta's "government of butchers."

The problem dragged on for years. At first, Wilson hoped that simply by refusing to recognize Huerta he could help topple the regime and bring to power the opposing Constitutionalists, led by Venustiano Carranza. When Huerta established a full military dictatorship in October 1913, however, the president decided on a more forceful approach. First he pressured the British to stop supporting Huerta. Then he offered to send American troops to assist Carranza. Carranza, aware that such an open alliance with the United States would undermine his popular support in Mexico, declined the offer; but he did request and receive from Wilson the right to buy arms in the United States. Still the stalemate continued.

Finally, a minor naval incident provided the president with an excuse for more open intervention. In April 1914, an officer in Huerta's army briefly arrested several American sailors from the U.S.S. Dolphin who had gone ashore in Tampico. Although a superior officer immediately released them and apologized to the ship's commander, the American admiral demanded that the Huerta forces fire a twenty-one-gun salute to the American flag as a public display of penance. The Mexicans refused. Wilson seized on the silly incident as a pretext for sending all available American naval forces into Mexican waters; and a few days later, eager to prevent a German ship from delivering munitions to the Huerta forces, he ordered the navy to seize the Mexican port of Veracruz. Wilson had envisioned a bloodless action, but he was not to have his way. In a clash with Mexican troops in the city, the Americans killed 126 of the defenders and suffered 19 casualties of their own. With the two nations at the brink of war, Wilson now drew back and began to look for alternative measures to deal with the crisis. His show of force, however, had in the meantime helped strengthen the position of the Carranza faction, which captured Mexico City in August and forced Huerta to flee the country. At last, it seemed, the crisis might be over.

It was not to be. Wilson reacted angrily when Carranza refused to accept American guidelines for the creation of a new government, and he briefly considered throwing his support to still another aspirant to leadership: Carranza's erstwhile lieutenant Pancho Villa, who was now leading a rebel army of his own. When Villa's military position deteriorated, however, Wilson abandoned the scheme and finally, in October 1915, granted preliminary recognition to the Carranza government. But by now the president had created yet another crisis. Angry at what he considered an American betrayal, Villa retaliated in January 1916 by taking sixteen Americans from a train in northern Mexico and shooting them. Two months later, he led his soldiers (or bandits, as the United States preferred to call them) across the border into New Mexico, where they murdered nineteen more Americans. His goal, apparently, was to destabilize relations between Wilson and Carranza and provoke a war between them, which might provide him with an opportunity to improve his own declining fortunes. He almost succeeded.

With the permission of the Carranza government, Wilson ordered General John J. Pershing to lead an American expeditionary force across the Mexican border in pursuit of Villa. The American troops, during their 300-mile penetration of Mexico, were never able to manage a clash with Villa. They did, however, engage in two ugly skirmishes with Carranza's army, in which forty Mexicans and twelve Americans died. Again, the United States and Mexico stood at the brink of war. But at the last minute, Wilson agreed to the face-saving expedient of referring the dispute to an international commission, which debated for six months without agreeing on a solution. In the meantime, Wilson was quietly withdrawing American troops from Mexico; and in March 1917, having spent four years of effort and gained nothing but a lasting Mexican hostility toward the United States, he at last granted formal recognition to the Carranza regime.

By now, however, Wilson's attention was turning elsewhere—to the far greater international crisis engulfing the European continent and ultimately much of the world. The American response to the Great War transformed the nation's position in the world. It also provided Woodrow Wilson with his most important, and in the end most disastrous, opportunity to bring his strong sense of moralism to the conduct of international relations.